Management rights assignments
Management rights agreements are long term and it is quite common for them to be assigned from one resident manager to the next. It is almost unheard of for a management rights owner to last for the entire tenure of an agreement.
The body corporate is always a party to these agreements and it is a statutory requirement that its consent to be sought to any assignment of the interests of the resident manager under it.
A body corporate cannot unreasonably withhold consent to the assignment of management rights agreements, but that does not necessarily mean it has to say yes. A body corporate is well and truly entitled to understand the capabilities of the buyer and go through a formal assignment process.
We act for many bodies corporate in matters of this nature and because of our management rights expertise, we understand what needs to happen.
In any management rights assignment there is a ‘legal’ and a ‘commercial’ element. The legal element is always within our domain. We need to review all of the paperwork to make sure it is appropriate for the body corporate to enter into. We also need to advise the body corporate about its rights.
The commercial element is something that we can also be engaged with respect to. This extends to providing specifically tailored questions to be asked of the proposed resident manager along with confirmation that all of the criteria required by the buyer under the Body Corporate and Community Management Act 1997 and the management rights agreements have been met.
We have acted in hundreds of assignments and know exactly what should happen when. You can rely on us to give you the right guidance.